Wheat gives back some gains as U.S. dollar steadies
Chicago wheat futures fell 0.7% to $5.86-1/4 a bushel as a stronger U.S. dollar dampened demand. Corn and soybean futures also declined, with corn down 0.4% to $4.22-1/4 and soybeans dipping 0.8% to $11.20-3/4. Last week’s robust U.S. wheat export sales of 805,300 metric tons provided temporary support, but ample supply and improving weather forecasts for the U.S. Midwest and Black Sea region added to the bearish sentiment.
CANBERRA, July 8 (Reuters) -Chicago wheat futures fell on Monday as the U.S. dollar rose, reversing the dynamic of last week when a weakening dollar and strong U.S. wheat exports pushed prices higher.
Corn and soybean futures also slipped, with traders turning bearish again after concerns that dry, hot weather would damage U.S. crops lifted prices last week.
FUNDAMENTALS
* The most-active wheat contract on the Chicago Board of Trade (CBOT) Wv1 was down 0.7% at $5.86-1/4 a bushel by 0049, while CBOT corn Cv1 fell 0.4% to $4.22-1/4 a bushel and soybeans Sv1 dipped 0.8% to $11.20-3/4 a bushel.
* Prices of all three have rebounded slightly in recent days but wheat remains near two-month lows and corn and soybeans near their lowest since 2020 amid ample supply.
* The U.S. dollar weakened rapidly last week due to expectations of interest rate cuts. A weaker dollar makes U.S. farm goods more affordable for buyers with other currencies, which can improve demand. USD= FRX/
* U.S. Department of Agriculture data showed U.S. wheat export sales in the week ended June 27 at 805,300 metric tons for 2024/25, well above trade estimates.
* Also supporting wheat were forecasts for low French production. This year’s soft wheat harvest in France could see yields at an eight-year low and 11% below the 10-year average because of wet weather, crop institute Arvalis and grain industry group Intercereales said.
* Weather models showed drier weather for the U.S. Midwest and for the Black Sea region, the world’s biggest wheat export hub, according to brokers StoneX.
* Commodity funds were net buyers of CBOT corn, wheat, soyoil, soybeans and soymeal on Friday, traders said.
* Speculators hold net short positions in wheat, corn and soybeans, making those markets vulnerable to bouts of short covering that push up prices.
MARKETS NEWS
* Asian stocks inched higher on Monday as investors grew more confident about a September U.S. rate cut, while the euro grappled with political uncertainty as French elections pointed to a hung parliament. MKTS/GLOB
Source Link : https://www.xm.com/research/markets/allNews/reuters/wheat-gives-back-some-gains-as-us-dollar-steadies-53875388
Recommended for you
